Organic Consumers Association


Previous Page

Click here to print this page

Make a Donation!


Junk Food Giants Work Overtime to Suppress Health Insurance for Workers

Super-Sized Deception From Fast-Food Giants

By Eric Schlosser
Eric Schlosser is the author of "Fast Food Nation" (HarperCollins, 2002).

October 24, 2004

The television ad funded by the opponents of Proposition 72 ­ an initiative
that would require large and medium-sized business owners to give health
benefits to their workers ­ offers a grim scenario. "Our family-run
restaurant is doing OK," says a lovely Latina, walking past tables crowded
with customers. "Well enough to provide benefits for our workers." But
Proposition 72 would threaten all of that, she adds. It would cost her
restaurant more than $100,000. It would force her to raise prices or fire
workers. It would mean getting rid of the restaurant's "good private health
plan" in favor of a "government-run plan." The ad ends by warning viewers
that Proposition 72 would kill jobs and eliminate health benefits.

If George Orwell were alive today, he would marvel at the ad's scare
tactics, distortions and its fundamental misrepresentation of Proposition
72. For one thing, the woman in the ad isn't a restaurant owner; she's an
actress. The Los Angeles restaurant where the ad was filmed actually has
only 12 employees, making it too small to be affected. The initiative would
require employee access to private plans, not government insurance.

Moreover, the leading corporate sponsor of the effort to block its passage
is McDonald's. Other sponsors include Burger King, Wendy's, Jack in the
Box, Walgreen, Best Buy, Target, Sears and Yum! Brands (owner of Taco Bell,
Pizza Hut and KFC). Concern for the plight of family businesses is now
being used as a political tool by the very companies that have driven
mom-and-pops out of business.

The fact that Proposition 72 even appears on the ballot is further evidence
of how California's initiative laws, initially passed to thwart corporate
influence in politics, now facilitate just the opposite. In 2003, the
Legislature passed a bill requiring that large and medium-sized companies
offer health insurance to their workers. The story should have ended once
then-Gov. Gray Davis signed the bill into law. Instead, the California
Chamber of Commerce, the California Restaurant Assn. and their corporate
allies have spent millions of dollars to rescind the law through the
initiative process.

A "yes" vote for Proposition 72 would keep the law, calling for companies
with 50 to 199 full-time workers to provide them with health insurance by
2007. Companies with 200 or more full-time workers would have to insure
them and their dependents by 2006.

The fast-food industry is the nation's largest employer of minimum-wage
labor. The only American workers who consistently earn less are migrant
farm workers. Led by McDonald's, the industry has pioneered a workforce
that earns low wages, gets little training, receives few benefits and has
one of the highest turnover rates of any trade. Retail giants such as
Target and Wal-Mart have emulated these labor policies, and there's good
reason such service-sector positions are called "McJobs."

Jot Condie, president of the California Restaurant Assn., says passage of
Proposition 72 would immediately cause one-fifth of the state's restaurants
to shut down. In fact, the proposition would apply to fewer than one-tenth
of the state's restaurants and retail stores. Among employers with more
than 200 full-time workers, 99% already provide health insurance; among
those with 50 to 150 workers, 94% do. Opponents of Proposition 72 say it
would add annual health insurance costs of $2,500 to $7,000 per worker, but
supporters argue that such costs are wildly inflated because most fast-food
workers are young, healthy and single. Starbucks already offers health
benefits to full-time staff, as does Costco.

Eight years ago, the California Restaurant Assn. claimed that proposed
increases in the state and federal minimum wage would force the industry to
fire more than 100,000 workers. Nevertheless, minimum wages were raised ­
and the annual revenues of the California restaurant industry have nearly
doubled in the last decade. The industry is the largest private employer in
the state. It provides health insurance to executives and should now do the
same for all full-time employees. Its healthcare costs are now largely
covered by taxpayers. California spends about $4.6 billion a year on
medical care for the uninsured, while hospitals absorb an additional $5

Proposition 72 isn't a panacea. But it would provide insurance for more
than 1 million people. The disinformation being spread by multinational
fast-food chains shouldn't dissuade voters from doing what's right. Thirty
years ago, Hawaii adopted a similar plan. Today, it has one of the best
healthcare systems in the U.S. ­ and on Maui, there's no shortage of Big


Copyright 2004 Los Angeles Times